[MUSIC] Our next example of organizational innovation is provided by Syngenta in 2000. Syngenta rearranged it's structure to improve the access and sharing of its knowledge among its many department. In the next slide, I'm going to use Syngenta as a case study to clarify and illustrate the concept of organizational innovation. How company rearrange the structure in order to provide a product with a better quality for their customer. Syngenta, first, it's a global Swiss manufacturer that produce agrochemicals and seeds. It was widely regarded as a leader in agricultural products. And before 2010, Syngenta was organized in two division, Syngenta seeds and Syngenta crop protection. The seed unit was responsible for the development and sale of agricultural seeds, instead the crop production division developed, produced, and marketed products such as herbicide, insecticide and fungicide. Sygenta entire operating structures evolve around the seed and crop protection units, having a heavy focus on product development through strong investment in research and development activities. The company created expert in these two specific area of research and the company structure led experts from the seed units and the crop protection to work on same problems but from two different perspective and using different technology, without any kind of interaction among each other. Forthmore every year farmers received a field visit from two Syngenta agents, each one from different section, promoting seeds or fertilizer. The same strategy was undertaken by Syngenta's competitors. Therefore it was very difficult for farmer to select the right combination of seeds, fertilizer, price, and the quality. In 2011 also, Syngenta's customer were facing the increasing cost of production in price volatility for their production. Therefore, Syngenta that time decide to change its internal structure, looking for synergy among its two divisions, the crop and seed unit. By sharing knowledge between them, lowering the cost of the business, and produce a product with a better quality. The idea that time was to reorganize the structure with a new philosophy, call it think as a farmer. Thus Syngenta created a crop-based pipelines where all seed and crop protection technologies and product for a given crop will be evaluated and considered together. Therefore, Syngenta rolled its seeds and crop protection division together and shifted from a product perspective to a crop-based focus. The idea, to integrate and share employees' knowledge on a specific crop, led to the creation of improved products with higher productivity. Indeed, Syngenta began to produce seeds that are genetically resistant to disease and additionally coated with fertilizer that protect the plants throughout the entire life cycle. Additionally, farmers found a new products very useful, as they generate higher productivity within only one solution. This organizational change led Syngenta ABT team to grow and Syngenta share price to increase. Thus, farmer who had bought Syngenta's share in the stock market gained additional income. And what Syngenta did in 2011, it's a clear example of organizational innovation. Whereby rearranging the corporate structure, Syngenta was able to develop improved products that could be better fit farmer's needs. An alternative classification of innovations divide innovations according to their level of novelty. By using this classification, innovations can be divided into incremental and radical ones. A radical innovation is any innovation that produce completely new products. This type of innovation has a significant impact on the market as well as on the activity of firm that develops such innovation. Radical innovation typically change the market structure, create a new market, rendering existing products obsolete. In the competitor view, radical innovations create the major disruptive change. Instead, incremental innovation continuously advance the process of change. Indeed, incremental innovation concern an existing product, service, process or organizational method where its performances have been significantly announces or upgraded. Radical innovation are generated by complex and time-consuming processes which imply difficulties and risks. An example of radical innovation in the Agro-Food sector is that insect-based foods are shown in the picture. Such products is completely new for the Agro-Food market. It can catch the attention of this consumer looking for alternative source of protein. On the other hand, incremental innovation is the most dominant form of innovation in the Agro-Food sector. Examples of incremental innovations are functional foods, which are foods that defer from the regional one due to the addition of a component that improves human health. In this case, we don't have a completely new product or process. But just a product [INAUDIBLE] compared with the previous one. With the definition and types of innovation, I conclude the first lesson of Model One. See in Lesson Two of Model One, model of innovation and diffusion of an innovation.
